Russian Oil Is No Longer India’s Easy Bargain
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India’s crude imports fell in August, and Russia’s share declined with them, exposing a supply problem that seasonal refinery patterns alone cannot explain.
The usual maintenance period at Indian plants comes toward the end of the monsoon, when domestic diesel and gasoline demand typically eases, but most refiners have largely postponed this year’s work because the current market crisis has producedstrong marginson refined products.
Demand has also remained unusually resilient.
The more consequential shift is on the other side of the trade: Russia is exporting less crude both to India and overall, just as China is competingmore aggressivelyfor available cargoes.
The question for the coming months is therefore whether August represents a temporary retreat or the start of a period in which Russian barrels become scarcer, costlier and harder for Indian refiners to secure.
India imported 2.08 million b/d of Russian crude in August, returning to May levels after taking2.8 million b/d in July.
Overall crude imports declined to 4.7 million b/d from 5.05 million b/d, although the August total was still the highest for that month in five years and comfortably above the five-year August average of 4.2 million b/d.
However, usual refinery maintenance may explain only part of the retreat – the high fuel margins on the market have made most of the refiners postpone the monsoon-season maintenance.
BPCL’s Mumbai refinery had planned work for September, but has reportedly moved it to November, while only partial maintenance and shutdown work may take place at CPCL’s Manali refinery in Chennai in the weeks to come.
Combined with MRPL shutting its 60,000 b/d CDU-I for a period of four weeks, coming back towards the end of September, India’s autumn maintenance might feel surprisingly light compared to previous years.Related: Oil Prices Surge as U.S.
and Iran Exchange Strikes Domestic consumption has meanwhile been stronger than usual: July demand for both diesel and petrol was about 10% higher than a year earlier, reaching 8.09 million tonnes and 3.82 million tonnes, respectively.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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